The five-year bond with a coupon of 5.625 per cent, is the first from Nigeria that is registered with both the United Kingdom Listing Authority and the United States Securities and Exchange Commission, and targeted at retail investors, according to a statement from the LSE.
The Head of Middle East, Africa and South Asia, International Markets Unit, LSE, Ibukun Adebayo, was quoted in the statement as saying that, “We are delighted to welcome Nigeria’s third capital raising this year on the London Stock Exchange. “The innovative structure of the bond allows, for the first time, retail investors to participate in the financing of infrastructure projects as part of the development of Nigeria’s economy.
“The successful listing reinforces London Stock Exchange’s position as a strong partner for Nigeria and as a leading global venue for raising debt finance.”
The issuance of the bond follows the country’s success in raising $1.5bn from a 15-year Eurobond earlier this year. Interest from retail investors around the world on the bond was high indicating confidence in Nigeria’s economy. It was 130 per cent subscribed and raised a total of $300m. Proceeds will be used to fund infrastructure projects in the country.
Also commenting on the development, the Director-General, the Debt Management Office, Abraham Nwankwo, said, “Today, Nigeria records another milestone in international capital markets as it lists its debut diaspora bond on London Stock Exchange.
“The opening of this source of funding for Nigeria and the listing of the diaspora bond on the London Stock Exchange will ensure that the opportunity to invest in Nigeria will be available to a wider range of investors especially Nigerians in the Diaspora who wish to contribute to the development of the country and also earn returns.”
The DMO, in the beginning of this month, announced the commencement of a global offering of Nigeria’s first Diaspora Bond.
It said that the nation had filed a registration statement for the bonds with the US. Securities and Exchange Commission, adding that application would be made for the bonds to be admitted to the official list of the UK Listing Authority and the London Stock Exchange Plc.
The office had said this was to ensure that the bonds were admitted to trading on the London Stock Exchange’s regulated market.
It said, “The bonds will be direct general obligations of Nigeria and will be denominated in the US dollars.
“The international joint lead managers are Bank of America Merrill Lynch and the Standard Bank of South Africa Limited.”